You're following directions that are several years old and for a different player. MediaMonkey doesn't create properly formatted .m3u playlists after the update to 4.x. The directions are for a Clip, not a Clip+.

The directions for using Winamp should still work. Like then i'm not inclined to install it right now but it worked on my Clip+ when I had it installed a couple of years ago.

If you prefer not to install any new software you can drag and drop the files onto the card and use XMPlay or Mp3tag to create your playlists. Those can be used in a portable mode that doesn't require installation. They both create the EXTM3U playlists the Clip+ can read. The playlists can't include files from both memories or they'll break. They also won't work if you use the Playlists folder to store them. I use the root of the drive to store mine.

Using Media Monkey 4.0.7 and Sansa Clip Plus connected using MSC mode, here's how I got playlists working for sync to device and to play them on the device.

Step 1
* Create Playlist in Media Monkey.
* Select the Playlist in the Auto-sync list in Media Monkeyfor the Clipp.
* Sync
* Media Monkeyautomatically knew to copy music to the Music folder and playlists to the Playlists folder.
* Options/Destinations in MM for the Clipp were all setup correctly pointing to, e.g. "\Music\" and in Options/Playlists the Destination directory option was already set to "\Playlists\".

Music and playlist get copied to the Clipp, but Playlist shows up as "empty" when opened on the Clipp. The playlist is indeed simply list of files, not EXTM3U.

So far... playlist created in Media Monkey worked for synchronization to device, but the playlist itself was not readable/playable on the device.

Step 2To get playlist to be readable/playable on the device, all I had to do was go to Options/Playlists for the Clipp in Media Monkey and select the option "Force Relative Paths". (I did not change to "Use extended m3u").

Now when I open the playlist in the Clipp, it no longer displays "empty" but shows all the contained tracks.

OK. I have been playing around with WinAMP and the Clip for a while now as far as playlists and I figured out an easier way to do them. Here you go:

1. Install/open Winamp and plug in your Clip.
2. On the left right click on "Playlists" > "New Playlist". Name it and click "OK".
3. Select "Local Media" > "Audio". Go through your music and drag and drop your music to the playlist.
4. When you are happy with your playlist, drag and drop your playlist to "Portables" > "Sansa Clip 2GB".

Now all the songs will copy to your clip and create the playlist in one action. A little easier than my previous directions. Let me know how this works out for you all. Enjoy!!!

...To get playlist to be readable/playable on the device, all I had to do was go to Options/Playlists for the Clipp in Media Monkey and select the option "Force Relative Paths". (I did not change to "Use extended m3u").

Now when I open the playlist in the Clipp, it no longer displays "empty" but shows all the contained tracks.

Nice tip there. I gave up even trying with MediaMonkey because I have other alternatives that work right out the box like XMPlay and MusicBee. Someone that uses MM and doesn't want to install the script to make EXTM3U playlists work should find this useful.

This seems to only work with files that are synced using files that aren't on the player. When I tried creating a playlist from files that existed on the player the results were the same. Absolute paths were used in the playlist and the playlist was broken when I viewed them on the player.

The results were even worse when I tried syncing a playlist using MM that I created using files from the player. MM tried to overwrite the existing files and seems to have permanently deleted them. The playlist is there but it doesn't work because the files it referenced have been wiped away.

I don't use MM much now and probably won't be digging into this much. Do you know a setting you know that doesn't create duplicate files or kill the originals when you try to create a sync using files from the player?

Here it is early 2014 and making playlists on a cool little, rock solid, 2008 Sansa Clip postage stamp sized music player with microphone and an FM radio still means something.

This description ran on longer than I thought it would. At the bottom I'll have a quick list. Scan through the first part to see if you need to read some detail first though. I've also added a mention of another free tool at the bottom that might be handy.

Testimony:
I really like my good ol' Sansa Clip 2Gb. Sometimes I'll lose it for a couple of months but it always comes back strong. I never really needed playlists before, the main thing for me was getting the MP3 headers/metadata/tags right. Then all I had to do was essentially to "put the album on the turntable and drop the needle in the groove."

Need:
That was until I started to take a group piano class and the teacher picks lesson songs from all over the book/CD. No problem, I'll make a playlist! It was a lot more effort than I thought.

Noteworthy:
It's hard to stress how important good, clean, consistent tags are. I'm happy with MP3Tag which is a free download from your favorite trusted site. Depending on the rip utility you might be able to get away with using the Windows Explorer file Properties/Details tab to clean up a small number of files.

Justification:
This method works for me, no duplicate songs but as much overlap as I need and it uses the native Windows Media Player 12 (WMP) that comes with Win 7.

Sys Admin stuff:
Just to make it simple I backed up my device to a directory that was not on any library path...
And then used the format utility in the device menu to start from scratch

System:
These details are from an up-to-date Windows 7 PC

---The Setup
Use USB MTP mode on the Sansa Clip. (It seems that no matter what: you need choose one or the other for things to work right.)
Connect the clip to the PC.
Open Windows Media Player (WMP, version 12 on this system)
On the right column with 3 tabs, click the Sync tab
Gather some or all the music you want from the collection on your PC by opening it by clicking in the left column and dragging it to the right column. Albums and songs were all I chose. It seems the MP3 Tags ultimately sort things.
Click the Start sync button just under the Play/Burn/Sync tabs up top.
Be patient while the music files are copied to the Sansa Clip.
(If the files are already on the device, WMP will compensate.)
Use the "Click here" link to see the sync results that appears when the copy is done.

---Playlist Creation
THE KEY>> Use the PC as the "source" for the Playlist files, no dupes are copied to the device.
With the button near the top left... Create playlist
With the music files, whether Song, Artist, Album, or Genre; drag files, whole albums, artists, etc to the left into the new or appropriate playlist
Drag the playlist to the right side column where the Sync tab is chosen.
Click the Start sync button
When it's done, use the "Click here" to see your results just to make sure, notice the 'Already on device' and 'Synced to device' entries. Yippee, no duplicates, no wasted space!

Recap:
Start with good MP3 tags
Start with a backed up and formatted system if you are switching USB modes.
Use USB MTP mode for this method
Connect your Sansa Clip
Open WMP
Drag the music you want into the Sync column on the right side of WMP
Sync WMP and the device
Double check your work with the "click here" link that appears upon completion
Make a new playlist (or re-use an old one)
Open a music classification on the left and drag music from the center into a playlist
Drag the playlist to the Sync column on the right side
Click Start sync on the top of the right column
Double check your work with the "click here" link

SHORT SYNOPSIS that uses playlists only
Use good MP3 tags
Choose either MTP or MSC mode and stick with it
Backup and format your device through the device menu
Connect the device
Open WMP
Create a tag
In WMP Drag music from your PC to the playlist on the left
When finished, Drag the playlist to the Sync column on the right
Start Sync
Check your work with the "click here" link.
(You see, you can create a single, huge, AllMyMusic type tag to populate your device with everything that will fit, and then make other tags to sort it out.)

BTW: If you want to use the MSC mode, WMP might work, I didn't test it. If WMP doesn't work, try the "Sansa Clip Playlist Creator 0.99b" on Softpedia or Sourceforge, people seem to like it. It doesn't like MTP mode though re: "Connect Device" if connected as MTP.

Title tells the story. Works like a charm on my Clip +'s and Clip Zips. Transferring from Media Monkey to the player and then editing the Playlist and renaming it are simple. If you have a Tag problem use MP3Tag 2.58 to do a fix.
I do not use WMP for anything and find that Media Monkey Gold Lifetime works just fine. Then again I have not tried using it to Sync movies or anything other than music.
Just my 2 cents on what works and both programs are FREE, btw.